Uganda removes land-based casino exemption from 15% winnings tax

Uganda’s Parliament has approved a change that will subject winnings from licensed land-based casinos to the same 15% withholding tax applied to other betting and gaming activities, closing a tax distinction that President Yoweri Museveni warned could encourage avoidance and revenue leakage.

Uganda’s Parliament has removed a proposed exemption that would have excluded winnings from licensed land-based casinos from the country’s 15% withholding tax on betting and gaming winnings. The decision brings the tax treatment of physical casinos into line with the online gambling sector and forms part of a broader effort to harmonise Uganda’s gambling tax system.

The change was approved by Parliament on August 4 after President Yoweri Museveni returned the Income Tax (Amendment) Bill, 2026 for reconsideration. In a letter dated July 10, Museveni objected to the casino exemption, arguing that substantially similar gambling activities should not receive different tax treatment solely because one is offered online and the other at a physical venue.

Under the revised approach, a 15% withholding tax will apply to net winnings from land-based casinos, as it already does to online betting and gaming winnings. Winnings paid under Uganda’s national lottery will remain exempt.

The parliamentary Committee on Finance, Planning and Economic Development supported the President’s position. Committee chair Maximus Ochai said maintaining the exemption could create opportunities for tax avoidance and revenue leakage by allowing operators or customers to benefit from different treatment depending on the platform through which essentially similar gaming activity is conducted.

Finance Minister Henry Musasizi had also backed the proposal during the reconsideration process. He argued that different treatment for online and land-based casino activity could encourage businesses to structure their operations through exempt channels specifically to obtain a tax advantage. The government expects the harmonised measures to help protect projected gambling-related revenue of approximately UGX65 billion for the 2026/27 financial year.

The reform is part of a wider restructuring of gambling taxation in Uganda. Earlier in 2026, Parliament approved amendments to the Lotteries and Gaming Act that established a harmonised 30% tax rate for betting and gaming operators. Betting had previously been taxed at 20%, while gaming was subject to a higher rate. The latest change extends the same principle of tax neutrality to player winnings.

The move is significant for licensed land-based casinos because operators will now have to account for withholding tax on their customers’ net winnings rather than benefiting from the exemption contained in the earlier version of the legislation. For the government, the objective is to reduce tax arbitrage and ensure that the growth of digital gambling does not create fundamentally different fiscal rules for comparable products offered through physical venues.

Uganda’s latest decision therefore continues a broader shift toward a more unified gambling tax framework. By taxing net winnings consistently across online and land-based channels while preserving the national lottery exemption, authorities are attempting to balance revenue collection with greater neutrality between different forms of regulated gambling. The practical impact will now depend on implementation and on how operators adapt to the combined effect of higher sector taxes and the expanded withholding regime.